Manufacturing Sector Loses Over N300billion to Forex policy

The MAN scribe, who explained that though she was not well informed on the method used in computing the loss, a critical look at the sector would reveal that more than N300 billion had actually been lost.

She said:“When you really look at it, you will find out that more than the N300 billion has been lost because we (manufacturers) bought foreign exchange (forex) last year between N170 and N200, but now technically, we are buying it for N350.

This is because with the new forex policy, manufacturers have to wait for a certain period of time to be able to get forex allocation from government,” Mrs Okoli said.

The earliest allocation of forex to some manufacturers would mature by July 22, whereas some of the commitments made to their suppliers have not yet been redeemed, she said.

Shedding more light on manufacturers’ woes, the MAN VP who is also the Chief Executive Officer, Emzor Pharmaceuticals, explained that those that placed orders for raw materials at the old exchange rate and hadn’t paid for them because they didn’t have access to forex at the time, are now worse off as they must redeem the payment and commitment to their suppliers at a higher cost now given the current rate.

However, irrespective of this development, Okoli says there is a very bright future for the sector. Her conviction is derived on the belief that the government is not going to neglect the manufacturing industry.